Sens. Mitch McConnell (R-Ky.), Richard Shelby (R-Ala.) and Judd Gregg (R-N.H.) (EPA/ZUMApress.com)
For the past year, Republicans have insisted that Congress take up legislation to stop the losses at Fannie Mae and Freddie Mac — the government-sponsored enterprises that buy up and repackage mortgages, keeping loan prices stable. Fannie and Freddie have incurred more than $150 billion in losses since the burst of the housing bubble. “In my view, it’s simply not acceptable for some on the other side to suggest that we have to rush this [Wall Street] bill through Congress, but that it’s okay to wait another year to address the GSEs, which we all know played a central role in the financial crisis,” Sen. Mitch McConnell (R-Ky.), the minority leader, argued earlier this month, a contention often repeated.

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But the Republicans never said how they thought the GSEs should be reformed — until now. Last Wednesday, Sen. John McCain (R-Ariz), Sen. Judd Gregg (R-N.H.) and Sen. Richard Shelby (R-Ala.) proposed an amendment to Sen. Chris Dodd’s (D-Conn.) financial regulatory reform bill, the GSE (Government Sponsored Enterprise) Bailout Elimination and Taxpayer Protection Amendment.
Releasing the proposal — with numbers, dates and directives aplenty — Gregg commented, “Fannie Mae and Freddie Mac are synonymous with mismanagement and waste and have become the face of ‘too big to fail.’ The time has come to end Fannie Mae and Freddie Mac’s taxpayer-backed slush fund and require them to operate on a level playing field.”
But housing market experts describe the Republicans’ proposal as disastrous. Analysts from both sides of the aisle contend that the proposal would unwind Fannie and Freddie so quickly and precipitously that it would destabilize the entire housing market: pushing mortgage prices up, pulling support from low and middle-income Americans and ending the nascent — if at all extant — housing recovery.
The GSE amendment would effectively shutter the mortgage giants, which together backstopped 97 out of 100 new mortgages in the first three months of the year, according to Inside Mortgage Finance. It would keep keep the current government conservatorship in place for 24 months (or 30 months, if the Federal Housing Finance Agency determines that market conditions are “adverse”). Then, it would begin begin the process of dissolution.
Were Fannie and Freddie to prove “viable” as private institutions (a term left ambiguous) after 24 or 30 months, they would become highly regulated institutions for three years, before the expiry of their charters. They would have no affordable housing goals, would have to reduce their mortgage assets yearly, could not purchase mortgages exceeding median-home values and could only buy mortgages with certain minimum down payments — among other provisions. Additionally, they would have to pay taxes. Were Fannie and Freddie not “viable” in two years — likely, given that Fannie reported yesterday that it does not see itself reporting a profit for the “indefinite future” — the amendment puts them into receivership.
Housing experts say that the bill would impact every participant in the housing economy, including builders, buyers, developers, lenders and banks. It would make vanilla mortgages — such as 30-year, fixed-rate mortgages — much more scarce, and would make all mortgages more expensive. It would remove a major source of liquidity in the mortgage market, causing credit problems at mortgage-reliant banks. It would also rapidly reduce the number of homebuyers.
Experts describe the McCain-Gregg-Shelby amendment’s transition as too much, too soon and too blunt. Kenneth Posner, who analyzed Fannie and Freddie for Morgan Stanley and is the author of Stalking the Black Swan, describes the plan as going “cold turkey” when it might be better to “use methadone.”
“The issue is that what Fannie and Freddie issue is considered close to government debt, and there is no limit on their ability to grow. That was fine a long time ago when they were small. But now, they’re big — we’re creating trillions of dollars of Treasury-like debt,” he explains. “We’re also dealing with the reality that too much stimulus for the housing market is a bad thing. That’s what the Republican [proposal] is getting at. But it does not answer the question of the transition [away from that support].”
Barry Zigas, the director of housing policy for the Consumer Federation of America, is blunter. He says that the Republican approach takes a “meat-axe” to an extremely fragile market. “It takes a very prescriptive and dangerous approach to a problem that at this point does not require it,” he says, noting that the Senate has not even held hearings on how to deal with Fannie and Freddie yet.
“It puts any housing recovery in jeopardy — the amendment is a huge gamble that forces the government to quickly and radically restructure these two companies without providing a clear path to a stable mortgage market in the future,” he says. “For one, it would raise down-payment requirements precipitously, which would be injurious to low-income communities and communities of color.
“This is a very heavy-handed and ultimately very unhelpful approach to a complex problem.”
“Some of it is serious. Some is trying to stir up trouble,” says Dean Baker, the co-director of the Center for Economic and Policy Research. “It doesn’t make sense to talk about dismantling Fannie and Freddie yet — and we’d really have to think this through more thoroughly. It does not, for instance, explain how it would sell off Fannie and Freddie’s assets, or in what form. Who would back them? What is the benefit to rushing this?” Baker says. “The risk is so obvious that the proposal seems strange.”
And with such obvious risks and despite Republican pressure, Democrats have punted on the question of how to reform Fannie and Freddie. This spring, the Treasury Department released a set of seven questions it said it was attempting to answer — stating that it was working on reform but needed more time. And yesterday, Sen. Mark Warner said the administration plans to release its Fannie and Freddie proposal next year.
“I think it’s a fair claim to make to say we haven’t done enough to address Fannie and Freddie,” Warner said. “It is the big elephant in the room that hasn’t been addressed.” But, “We’ll come back next year and take on Fannie and Freddie in a more thoughtful way.”

COMING TO YOU LIVE DIRECTLY FROM THE DUBIN LAW OFFICES AT HARBOR COURT, DOWNTOWN HONOLULU, HAWAII LISTEN TO KHVH-AM (830 ON THE AM RADIO DIAL) ALSO AVAILABLE ON KHVH-AM ON THE iHEART APP ON THE INTERNET . Sunday – MAY 19, 2019 Is a Homeowner’s Appeal Moot Upon the Sale of Foreclosed Property? — Another […]

WAPO- The grass got long. Jim Ficken knows it. But was it so long that he should have to pay the city of Dunedin, Fla., nearly $30,000 and lose his home to foreclosure? Ficken, for one, would rather ask a judge. The 69-year-old retiree is now at risk of losing his home because he doesn’t […]

Consumer Financial Services LAW MONITOR- On April 29, New Jersey’s governor signed into law bill A4997, known as the Mortgage Servicers Licensing Act. As the title indicates, the Act creates a licensing regime for servicers of residential mortgage loans secured by real property within New Jersey. As with many state licensing regimes, the Act exempts most ban […]

Pamela Mosley was just starting a new business when she was diagnosed with breast cancer. Unable to work for the next 13 months she fell way behind on her mortgage payments and was about to be foreclosed on. WFMYNEWS2- Pamela Mosley is the type of person who does things, anything and everything. Mosley has three […]

COMING TO YOU LIVE DIRECTLY FROM THE DUBIN LAW OFFICES AT HARBOR COURT, DOWNTOWN HONOLULU, HAWAII LISTEN TO KHVH-AM (830 ON THE AM RADIO DIAL) ALSO AVAILABLE ON KHVH-AM ON THE iHEART APP ON THE INTERNET . Sunday – MAY 12, 2019 Foreclosure Workshop #74: Validity Versus Falsity — Proven Successful Ways in Which Homeowners […]

Lexology- On April 29, the New Jersey governor approved several bills related to mortgage lending in the state. According to a press release issued by the governor, the package of nine bills addresses the state’s foreclosure crisis and includes the following: A 4997, known as the Mortgage Services Licensing Act, requires persons who act as mortgage servicers […]

COMING TO YOU LIVE DIRECTLY FROM THE DUBIN LAW OFFICES AT HARBOR COURT, DOWNTOWN HONOLULU, HAWAII LISTEN TO KHVH-AM (830 ON THE AM RADIO DIAL) ALSO AVAILABLE ON KHVH-AM ON THE iHEART APP ON THE INTERNET . Sunday – MAY 5, 2019 Foreclosure Workshop #73: Wells Fargo Bank v. Prentice – Highlighting Another Emerging Challenge […]

It seems nothing gets a judge angrier than being challenged on the court’s misconception of law. In 42 years of trial experience my conclusion is that sometimes you need to risk veins popping in the neck and even contempt citation to get your point across. Yet in the heat of the moment it is easy […]

Editors; Note: Everyone looking for an attorney should listen to this show. Every lawyer thinking about turning down or accepting a case involving foreclosure defense should listen to this show. Thursdays LIVE! Click in to the Neil Garfield Show Tonight’s Show Hosted by Charles Marshall Call in at (347) 850-1260, 6pm Eastern Thursdays Charles Marshall is on […]

Until this decision I had assumed that Qui Tam actions were essentially dead in relation to the mortgage meltdown. Now I don’t think so. The question presented is whether actions brought by a private person acting as a relator on behalf of a government entity can bring claims for damages under the False Claims Act. […]

In response to my blog post last week about whether there might be causes of action for royalty or other damages or offset arising from the fact that the loan is actually a small part of a much larger group of transactions in which the borrower is a party but not a participant in profits, […]

New York State Judge Arthur Schack passed away on May 2nd, aged 71. As phrased by “Summer Chic” “he was nothing short of a mensch which, in Yiddish, is an honorific not bestowed lightly. “His life was a testament to compassion; evidenced during his sixteen years on the bench in Brooklyn’s State Supreme Court and, […]

It’s easy to blame borrowers for loans that are in “default.” The American consensus is based upon “personal responsibility”; so when a loan fails the borrower simply failed. But this does not take into account the hundreds of millions of dollars spent every year peddling loans in the media and the billions of dollars paid […]

Listen to Show Click Here: http://www.blogtalkradio.com/neilgarfield/2019/05/16/escape-from-bankster-fraud—case-study-in-the-wamu-chase-fraudulent-scheme Hello, Neil Garfield here and this is Thursday April 25, 2019. Tonight, with the help of my guest Stephen Renfrow, we are going to take a closer look at the whole fraudulent scheme surrounding the false cla […]

Banks should be intermediaries, not the principals in a transaction. If you write a check your bank is not buying the TV. Original documentation and actual facts clears everything up. But what happens if original documentation disappears like it did in the mortgage meltdown? We are left at the mercy (nonexistent) of the banks who […]

“While overall foreclosure activity is down nationwide, there are still parts of the country where we may need to keep a close eye on,” said Todd Teta, chief product officer at ATTOM Data Solutions. “For instance, Florida is seeing a steady annual increase in total foreclosure activity for the 8th consecutive month, which is being sustained by a constant […] […]

Thursdays LIVE! Click in to the Neil Garfield Show Tonight’s Show Hosted by Neil F Garfield Call in at (347) 850-1260, 6pm Eastern Thursdays Tonight’s guest is Stephen R Renfrow, born 1957 in Louisiana. He graduated with Honors from Louisiana Business College and Bakers Professional Real Estate College. He has extensive experience in Banking and Real Estate […]

LivingLies is still LivingLies Livinglies.wordpress.com=Livinglies.me Millions of people use LivingLies as a resource for considering foreclosure defenses, new laws and even law enforcement. A few weeks ago I added PureChat for people to ask direct questions. The Chat function is located at the bottom right of your computer screen. I usually respond fairly q […]

Please address comments suggestions, case law and statutes to the following email address: NeilFGarfield@hotmail.com I am currently looking at a few new strategies. I will briefly outline them here not as recommendations but as possibilities that I think deserve exploration. As part of the collaborative effort of the LivingLies blog started in 2007 I am […] […]

References to sales of loans and servicing rights are usually merely false assertions to distract homeowners and lawyers from looking at what is really happened. By accepting the premise that the loan was sold you are accepting that the loan was (a) real and (b) owned by the party who was designated to appear as […]

NOTE: This case reads like law review article. It is well worth reading and studying, piece by piece. Judge Marx has taken a lot of time to research, analyze the documents, and write a very clear opinion on the truth about the documents that were used in this case, and by extension the documents that […]

Our 4th President, James Madison was insistent on reminding everyone that in the end it is the vote of people that ultimately makes law in our Democratic Republic. Your vote does count even though there are forces trying to prevent you from voting and PR campaigns to convince you not to vote. * In the […]

Besides strict compliance with all appellate rules, lawyers must be in strict compliance with common sense. I know of no better way to immediately eliminate your chances on appeal than to assert abuse of discretion unless you have a situation that is shocking and stupid. Everything else comes under the heading of reversible error. […]

Originally published in October, 2008 this is a revised version of an article that correctly articulated the main weak points in the cases being presented for enforcement of mortgages and deeds of trust. Back then I made a few errors as to the actual duties of the trustee. I found out later that there were […]

Originally posted in November, 2008 this illustrates what happens when you destroy notes and then “recreate” them for purposes of claiming you have the original in court. The fact remains that neither of them had the original note because, as the Florida Bankers Association told the Florida Supreme Court, it was industry practice to destroy […]

Originally posted in September 2008, here is my update of issues that lawyers, regulators, judges and even borrowers have still not quite absorbed: Some time ago we mentioned on these pages that the auditors who certified the financial statements (KPMG, here) would come under intense scrutiny simply because they MUST have known, by simple common […]

Thursdays LIVE! Click in to the Neil Garfield Show Tonight’s Show Hosted by Charles Marshall and Bill Paatalo Call in at (347) 850-1260, 6pm Eastern Thursdays It’s not so easy to ascertain the name of the Plaintiff in foreclosure cases, where the Plaintiff is named as “U.S. Bank as trustee for XYZ Trust.” But the sanctions that […]

Perjury Law Defense Penal Code 118a & 118(a) Information regarding the crime of perjury is found at California penal code section 118a and 118(a). To prove that the defendant is guilty of perjury, the prosecutor must prove: The defendant testified, under penalty of perjury, in a court of law or on legal documents, and The defendant […]

Upon doing the deposition of Joeffery Long Wells Fargo I was amazed that they could be so blatant as against the California Homeowners Bill of Rights but then again it is Wells Fargo Joffrey Long rough draft Joffrey Long exhibits

Robert Wilbert | Latest News | April 29, 2017 The Debtor testified that RCS notified him that on June 1, 2016, Ditech would begin servicing the Note. A Ditech representative contacted the Debtor in June by phone and informed him that according to Ditech’s records, the Debtor was $2,000.00 in arrears on the Note. The […]

I would only add that none of the Trusts actually come to own the debt, loan, note or mortgage anyway. The creation of “assignments” and “powers of attorney” merely create the illusion of a transaction that never occurred. Rod Ciferri is licensed in New York State. I strongly recommend that lawyers read the following excerpt […]

By Tony Sarabia Published in Los Angeles Daily Journal January 3, 2013 Litigators often reach for doctrines such as res judicata or collateral estoppel to narrow the scope of a case. Res judicata prevents re-litigation of the same claim that was litigated in a prior case. Collateral estoppel prevents re-litigation of the same issue that […]

Getting the 50,000 or three times the actual damages (b) After a trustee’s deed upon sale has been recorded, a mortgage servicer, mortgagee, trustee, beneficiary, or authorized agent shall be liable to a borrower for actual economic damages pursuant to Section 3281, resulting from a material violation of Section 2923.55, 2923.6, 2923.7, 2924.9, 2924.10, 292 […]

2920.5. For purposes of this article, the following definitions apply: (a) “Mortgage servicer” means a person or entity who directly services a loan, or who is responsible for interacting with the borrower, managing the loan account on a daily basis including collecting and crediting periodic loan payments, managing any escrow account, or enforcing the note […]

2920. (a) A mortgage is a contract by which specific property, including an estate for years in real property, is hypothecated for the performance of an act, without the necessity of a change of possession. (b) For purposes of Sections 2924 to 2924h, inclusive, “mortgage” also means any security device or instrument, other than a […]

CIVIL CODE SECTION 2920-2944.10 2920. (a) A mortgage is a contract by which specific property, including an estate for years in real property, is hypothecated for the performance of an act, without the necessity of a change of possession. (b) For purposes of Sections 2924 to 2924h, inclusive, “mortgage” also means any security device or […]

Many of my readers are probably aware that California law allows commercial landlords to accept a partial payment of rent after service of a 3 Day Notice to Pay Rent or Quit and continue with an eviction action. This right to accept a partial payment after service of the notice is unique to commercial tenancies […]

On January 10, 2014 new RESPA rules went into effect concerning loss mitigation procedures. The new rules specify procedures a servicer must follow if a mortgage loan borrower requests loss mitigation assistance, such as a loan modification. The rules were drafted by the Consumer Financial Protection Bureau (“CFPB”). In drafting the loss mitigation requireme […]

CONSTRUCTIVE FRAUD: The tort negligent misrepresentation (also known as “constructive fraud”) requires that each and all of the following elements be proved: “(1) a misrepresentation of a past or existing material fact, (2) without reasonable grounds for believing it to be true, (3) with intent to induce another’s reliance on the fact misrepresented, (4) [ […]

CONCEALMENT FRAUD: The tort of deceit or fraud by concealment requires that each and all of the following elements be proved: “(1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally […]

PROMISSORY FRAUD: The tort of deceit or fraud by a false promise requires that each and all of the following elements be proved: (1) a promise made regarding a material fact without any intention of performing it; (2) the existence of the intent at the time of making the promise; (3) the promise was made […]

PROVING FRAUD and or MISREPRESENTATION: DECEIT OR INTENTIONAL FRAUD The tort of deceit or intentional fraud requires that each and all of the following elements be proved: “(a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable rel […]